How the Japanese Yen's troubles are bringing a smile to Maruti Suzuki

Typically, the value of imports, which are in yen, is 7-8 per cent of the company's annual revenue

Maruti Suzuki India

The company also pays a small portion of the royalty in yen to the Japanese parent (major chunk of royalty is rupee denominated)

Shally Seth Mohile Mumbai
The recent currency volatility — rupee’s depreciation against international currencies — may have given heartburns to automakers that rely on imports or pay royalty to parent companies abroad. But for Maruti Suzuki India, favourable movement of the yen — the currency that matters the most — against the Indian rupee, has given it reasons to cheer. 

The yen’s sharp fall against the rupee and the rupee’s depreciation against the US dollar, which in turn will bump up export realisations, are set to give a margin boost to the maker of Baleno and Brezza, said analysts.

The softening of commodity prices and slew of new SUV launches in the coming months will also aid margins, they said. Year-to-date, the yen has depreciated 11

First Published: Jun 20 2022 | 06:10 AM IST

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